Part of 1. Questions to the Minister for Finance and Local Government – in the Senedd at 1:52 pm on 30 November 2022.
I'm very happy to set the record straight on both of those issues, and I'm grateful, particularly in relation to the first question, to have the opportunity to do so. On 5 August, I did write to the Finance Committee, and the letter has since been also shared with PAPAC, demonstrating that in the 2020-21 financial year, which was, of course, the extraordinary COVID year, the Welsh Government did operate within the overall departmental expenditure limit budgetary control set by Treasury, but, unfortunately, we weren't offered a level of flexibility to move money from revenue into capital to help us manage that particular issue. And, as a result of that inflexibility, there was funding returned to the UK Government.
But I think the most important point here to note is that the total underspend in 2020-21 by all UK Government departments was £25 billion, and that represents almost 6 per cent of the total provision made available to those departments in that year. All underspends by UK departments were returned to HM Treasury and, actually, the Department of Health and Social Care alone underspent by over 9 per cent, and that department alone returned £18.6 billion to Treasury. A Barnett share of that would have amounted to around £1 billion for Wales, and I think that that partly is behind the reason that the Chief Secretary to the Treasury has been so unwilling to offer us a level of flexibility. That's one of the issues that we have, of course: we need a much more settled way of dealing with these year-end issues, because relying on the flexibility, or otherwise, of whoever happens to be the CST at that point isn't an appropriate way to go forward.
So, just to finish this particular point, the overall underspend for Wales in that extraordinary year was only 1 per cent of the available resources, and I think that demonstrates the effectiveness with which our resources were managed during the extremely challenging circumstances. And it does continue the Welsh Government's record of being amongst the best UK Government departments, as they would see us, in Treasury terms, and devolved Governments in terms of utilising our budgets. So, I'm grateful to have the opportunity to put that on record. I'm happy to share that letter that I sent to the Finance Committee with all colleagues, perhaps, by putting it in the Library, Llywydd.
On the point of reserves, at the final budget agreed in March 2022, the unallocated DEL stood at £100 million revenue and an overprogrammed capital budget of £76 million. In the first supplementary budget, then, which was quoted in the exchange with the health Minister, the unallocated DEL was £152 million, and that was largely as a result of consequentials from the UK Government's spring statement and main estimates, and the overprogrammed capital position reduced to £68 million following a reduction in spending forecasts, but then that was offset again by the £30 million contribution in relation to Ukraine.
Since then, of course, we've seen the cost-of-living crisis very much take hold, so I don't think it's appropriate to give a running total of where we are in terms of pressures across Government and where we have the ability to respond to that within the reserve, just because that situation literally changes on a day-to-day basis. So, I have monthly monitoring reports from every colleague across Government, setting out where they are overspending and underspending against various items; I then discuss those with officials and we consider what appropriate mechanisms we have to respond to that to mean that we can bring the budget in where it needs to be at the end of the year. That situation does change all of the time, but what I will say is that the funding that we have available at the moment in reserves does not, by any stretch of the imagination, meet the pressures that we see across Government, which I think was what the health Minister was trying to convey in that exchange.